Consumers and businesses often purchase insurance to cover losses to personal property. In many cases, insurance related to a home or business may cover more than just the physical structure. For example, a typical homeowner's policy covers losses of items within the home, such as furniture, clothing, electronics, appliances, artwork, jewelry, and other items. Renter's insurance covers many of the same items, excluding fixtures and the like.
When a loss occurs, conventional practice is to have the insurance company (the “issuer”) assess the damage, estimate the loss, and provide a live check to the insured. In cases in which the property is held jointly (e.g., a husband and wife), the check is made payable to both individuals. While the issuer of the policy may control the amount of the check, it cannot determine how the insured will actually use the money. Moreover, issuing live checks is expensive, and prone to loss and fraud.
The retail and financial services industries have, over the past few years, actively embraced the “stored-value card” or “debit card” concept. These cards provide the holder with a pre-defined spending limit based on either a bank-account balance or a set amount associated with the card. The cardholder may use the card at participating retail establishments to purchase goods and services until the funds associated with the card are exhausted. Like credit cards, debit cards and some stored-value cards require authorization or activation by an individual cardholder prior to an initial use, and, in some cases, the use of a personal identification number (“PIN”) to use the card.
What is needed is a system and associated techniques and products that allow insurance companies to issue stored-value cards which may be used to purchase replacement items (or any other items needed) based on losses actually incurred by the insured. Further, because the insured is often a company or multiple individuals, such cards may require joint activation and, as such permit use by more than one person.